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Individual Needs and Social pressure: Evidence on the Easterlin hypothesis using repeated cross-section surveys of Canadian households

Author

Listed:
  • François Gardes

    (CES - Centre d'économie de la Sorbonne - UP1 - Université Paris 1 Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique)

  • Philip Merrigan

    (Département des sciences économiques - UQAM - Université du Québec à Montréal = University of Québec in Montréal)

Abstract

This paper provides additional evidence, using time-series and cross-sectional Canadian survey data, for the Easterlin hypothesis of an important income elasticity of individual needs. Our analysis is based on the regression of a minimum income to satisfy needs equation derived from a simple utility maximization framework. Moreover, our specification allows computing the Arrow-Pratt relative risk-aversion index and the Intertemporal Rate of Substitution. Our results are robust to different estimation methods dealing with the endogenous nature of income. We also compute poverty rates using our estimated equation parameters and standard OECD measures of poverty and find that some subjective measures are relatively close to the OECD measures.

Suggested Citation

  • François Gardes & Philip Merrigan, 2008. "Individual Needs and Social pressure: Evidence on the Easterlin hypothesis using repeated cross-section surveys of Canadian households," Post-Print hal-00650842, HAL.
    • Handle: RePEc:hal:journl:hal-00650842
    DOI: 10.1016/j.jebo.2006.06.009
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    References listed on IDEAS

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    Cited by:

    1. François Gardes, 2019. "The Estimation of Price Elasticities and the Value of Time in a Domestic Production Framework: an Application using French Micro-Data," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) hal-01478052, HAL.
    2. François Gardes, 2019. "The Estimation of Price Elasticities and the Value of Time in a Domestic Production Framework: an Application using French Micro-Data," Post-Print hal-01478052, HAL.
    3. François Gardes, 2019. "The Estimation of Price Elasticities and the Value of Time in a Domestic Production Framework: an Application using French Micro-Data," PSE-Ecole d'économie de Paris (Postprint) hal-01478052, HAL.
    4. Maryam Dilmaghani, 2018. "Religiosity and Subjective Wellbeing in Canada," Journal of Happiness Studies, Springer, vol. 19(3), pages 629-647, March.

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